View more on these topics

KSF IoM liquidation adjourned until April 9

The liquidation of Kaupthing Singer & Friedlander Isle of Man has be adjourned again until April 9 to allow the Treasury more time to work up a scheme of arrangement to help affected depositors.

The Manx government has pledged to underpin the scheme to wind down the bank with £150m in funding should recovery be less than 60p in the pound for depositors.

Speaking earlier this week Isle of Man Finance director John Spellman said the SOA, which would consist of three payments, would guarantee greater certainty for depositors in the absence of information from the UK on available assets.

He said the government was still taking legal consultation as to how insurance company bondholders would be represented in the scheme should it be accepted.

It is estimated that the SOA, which will be subject to court and creditor approval, will see 54 per cent of eligible depositors receive 100 per cent of their money back within three months of the scheme being signed, with 71 per cent repaid in full within two years.

Liquidator provisional figures given at the last court hearing show an estimated £402m to be locked in the UK seeking clarity with a further £140m in cash and £400m in the loan book.

Earlier this week Tynwald has approved a second and increased early payment scheme of up to £10,000 per eligible account holder with KSFIoM and these payments will begin in about a month from now. This will be financed by Manx government reserves up to a total of £94m.

Under the second scheme all accounts, including insurance bondholder accounts qualify for a maximum single payment of £10,000 irrespective of the number of joint or multiple beneficiaries to which that account related.

The EPS is a voluntary arrangement and would not affect the depositors’ entitlement to benefit under the scheme of arrangement once approved.

Information on the second early payment scheme and the documentation which must be completed to make a claim will be sent out to depositors in the week commencing February 23.

Spellman said a further pay out to depositors hinges on the recovery of available assets seized by the UK. He said: “No information has come through on this at all yet so we’re trying to create something which gives the depositors some degree of comfort while the position is clarified on the available assets. Nothing has come out in the last four months.”

Recommended

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment